Record home building in the 80s to spur a $3b renovation surge over the next three years

A building boom in the 1980s is expected to see a large number of homes become “ripe” for renovation over the coming three years.

ANALYSTS are predicting a massive $3 billion surge in renovation activity as a record number of homes built in the 1980s become “ripe” for rejuvenation.

Housing Industry Association senior economist Shane Garrett expected the renovation market to hit $35.12b by 2020 as the record volumes of homes built in the 1980s “become increasingly ripe for renovations work”.

Mr Garrett said there was a “strong correlation between the volume of renovations work and the age of the housing stock. The more houses between 30 and 35 years of age, the greater the need for renovations and improvements.”

Home remodelling is expected to rise as more older homes hit the market.

“The very elevated levels of new house building during the second half of the 1980s augurs well for renovations demand over the next few years – in fact, the 12 months to June 1989 remain the strongest on record for new detached house commencements and these will become increasingly ripe for renovations work in the next couple of years,” according to Mr Garrett.

In Queensland renovations activity was expected to gain momentum, rising by 4.2 per cent in 2019 and then by 5.9 per cent in 2020 – taking the value of reno work to in the state to $7.68b.

“The stock of houses of ripe-renovation age (30-35 years) in Queensland is set to expand very strongly over the coming decade, which will provide the foundations for a sustained recovery in the state’s renovations market,” according to the latest HIA Renovations Roundup Report.

Young couple painting wall in their room; generic renovations

It said nationally between mid-2017 and mid-2020, the number of detached houses in the 30-35 year age group would rise by 8.3 per cent to 552,600 with a further 1.9 per cent increase between 2020 and 2023.

“The stock of houses in the prime renovations bracket is expected to peak at 588,900 during early 2025 – about 15 per cent higher than in mid-2017.”

The outlook was also good for jobs in the renovations industry, with two out of every five employers expecting to boost their headcount in the next 12 months.

“This is a strong vote of confidence in the durability of the current renovations market recovery.”

The updated forecast for home renovations growth was a 0.2 per cent rise this year, 0.4 per cent next year, 4.9 per cent in 2019 and then 2.9 per cent in 2020.

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